Medicare Sets First-Ever Out-of-Pocket Cap at $5,000, With $39 Billion Annual Cost

Lawmakers introduced the Medicare Cost Cap Act on June 27, capping annual out-of-pocket spending for traditional Medicare enrollees at $5,000—a structural change the 56-year-old program has never had. The Urban Institute estimates it would increase Medicare spending by $39 billion (7.8 percent) relative to current law. Only 3.2 million high-cost beneficiaries would directly benefit, saving $1,024 annually on average.